The Next 5 Stocks to Buy?

It's not often you find an institution that allows the free-market philosophy to permeate its operations as much as financial-services company BB&T (NYSE:BBT) does. It made headlines a few years ago when it refused to offer loans for commercial projects on private lands that had been seized under eminent-domain laws. It's also funded university grants for the study of Atlas Shrugged author Ayn Rand and her pro-capitalist school of thought.

Putting its capitalist instincts to work, BB&T has acquired a portfolio of community banks, insurance companies, and non-bank financial-services businesses. BB&T has become one of the stronger banking names around. Possessing some of the top spots in market share throughout the Southern states it operates in, financial-services company BB&T now has more than 1,500 branch offices, enough to make it the nation's 14th-largest financial-holding company. What's more, while other banks -- such as Wachovia (NYSE:WB) -- have been cutting their dividends, BB&T just announced that it's raising its payout.

Even with CEO John Allison retiring at the end of the year, most analysts expect a smooth transition. His successor, Chief Operating Officer Kelly King, shares much of Allison's philosophical bent, and the pair has worked together for decades.

Screening for likeability
BB&T showed up on a screen of companies that have enjoyed growing investor support after wallowing on the outs three months ago. BB&T jumped from a two-star Motley Fool CAPS rating back in May to a three-star rating today, all while it enjoys a valuation below that of the market. In fact, CAPS member Buythedips finds the conservative nature of the bank an alluring attraction: "Conservative style and steadfast focus on expenses will result in outperformance of peers. Great dividend to boot."

CAPS is a 115,000-plus-member investor community that rates thousands of stocks on whether they will outperform or underperform the market. Although it's not a predictive service, our research has found that the 18-month returns of stocks in the CAPS universe correlated precisely with their relative CAPS ranking. Three-, four-, and five-star stocks outperformed low-rated one- and two-star stocks.

Here are a few of the other companies the CAPS screener found that are currently enjoying significant investor support:

Sources: Motley Fool CAPS, Morningstar. *For next fiscal year.

Naturally, this is not a list of stocks to buy and sell. Use it as a starting point for further analysis. Just bear in mind that investors achieve long-term outperformance by investing in growing, well-run companies that consistently increase shareholder value, and our CAPS members have raised their outlook significantly on these companies.

A fine mesh filter
You might not find sawdust on the floor, but Casey's General Stores has been serving up a mix of convenience and gas for 40 years that, like rival The Pantry (NASDAQ:PTRY), keeps customers rolling in. It was almost a year ago that CAPS member cbbruner highlighted this local watering hole.

In most small towns in Iowa, Casey's is the only convenience store. They have been in this market for over 20 years. They sell tasty pizza and a LOT of gasoline. They also serve as the local gathering place for people to meet and drink coffee. The main competition for Casey's in Iowa is the privately held "Kum & Go" ... chain, but mainly just in the larger markets.

Investors wanting to kick around the idea of shoe retailers, meanwhile, might want to keep in mind that DSW had a worn-down quarter last year that made comparisons easier this time around, so looking back two years might be more meaningful. Earlier this year, CAPS member ArtVandalay11 wasn't so sure the shoe retailer would thrive in the downbeat economy: "With the retail industry currently crippled in America, and not much sign of the economy turning around … there doesn't seem to be much hope for this shoe retailer as it should continue on its year long trend in the red."

Take a CAPS bow
There are many ways to screen for stocks to beat the market. You can use the new CAPS screener to find other stocks you're going to want to own and then start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made -- all from a stock's CAPS page. If you want to see what the best in CAPS are saying now about any of the companies mentioned in this article, head over to CAPS.